How AI is Helping Small and Medium-sized Law Firms Stay Ahead of the Curve

Jun 15, 2018

According to the Federation of Law Societies Canada, in 2016, there were 8,360 small and medium-sized law firms in Canada.

In this sea of similar-sized firms — many of whom offer similar services — artificial intelligence can help individual firms stand out.

Canadian Lawyer columnist Stephen Mabey makes the point that there’s a market “priced out” of larger firms available to lawyers from smaller firms, if they can “leverage applications to perform the tasks efficiently and with less costly lawyer intervention.”

The artificial intelligence software from Blue J Legal, offering AI solutions for tax and employment law cases, offer smaller and mid-size firms ways to embrace the future of the legal field by allowing lawyers to use their time more effectively to gain a competitive edge over the competition.

What is the product?

Blue J Legal’s software helps professionals find fast, accurate, and comprehensive answers to even the most challenging questions in tax and employment law. The company has two products: Employment Foresight and Tax Foresight.

The tax software, a joint effort with Thomson Reuters, applies AI to all relevant past judicial decisions in an effort to help tax professionals determine the strength of their position on issues like — and this isn’t an exhaustive list — residency, income vs. capital, director’s liability and the general anti-avoidance rule (GAAR). This product also has an advanced search function that finds cases by specific factors, rather than by keyword or boolean searches.

Similarly, Employment Foresight uses AI to help HR professionals, in-house counsel, and employment lawyers figure out how the courts would resolve common, complex employment law issues like — and this isn’t an exhaustive list — reasonable notice, employee drug testing, and worker classification.

How does it work?

The software starts off by asking you a series of questions to collect information about the context of the situation, such as the applicable province, timeframe and relevant facts.

After gathering the answers, the software compares this information to all relevant past cases. After the analysis is complete, a report is produced that conveys how likely it is that the courts would rule one way or another on the issue, along with a corresponding confidence level (expressed as a percentage). The software also provides an explanation for the prediction, which includes a list of past decisions that are most similar to the issue, based on what was inputted earlier. You can use this software to test out multiple scenarios and see how the predicted outcome would change given different assumptions and variables.

The software delivers results on obscure cases, and is kept updated with new decisions as they are published. When tested against cases that the system has never seen before the software, on average, achieves 90 per cent or greater accuracy.

Is it worth it for me, as a small or medium-sized firm?

There are several clear-cut benefits to small and medium-sized law firms who add AI solutions like Blue J Legal’s software to their toolkit: increased productivity, improved margins and the opportunity to be perceived as innovative providers acting in their clients’ best interest.

“One of the key drivers for law firms adopting AI, and advanced legal tech in general, is seen as the need for greater efficiency and productivity in responding to client pressure on fees, but also for lawyers to show how they are innovating in the clients’ interests”, reads a Thomson Reuters brief on the growing adoption of AI. “AI systems, such as contract analysis or new research systems, reduce the time spent on routine legal tasks and provide better value, productivity and efficiency. In which case, one might say that law firms adopting AI systems are ‘pushing on an open door’ when it comes to client response and welcome.”

As a small or medium-sized firm, you’re in a great position to embrace innovative legal technologies — specifically AI. The software offered by Blue J Legal can set you apart from the sea of similar firms.

What about due diligence?

Earlier this year, an OBA panel noted that artificial intelligence “can aid lawyers in completing menial tasks with accuracy” because AI can help with accuracy, speed, and precision in analyzing and collecting data — all while helping to reduce the possibility of human error. The panel noted that a software that could help with repetitive work where “lawyers often get ‘bored’,” like with document review within factums or legal briefs, would fall within the duty to be competent.

By generating an independent report tailored to your unique situation, Blue J Legal helps automate and record your due diligence.

Not to mention that the Blue J Legal team is comprised of former Bay Street lawyers from McCarthy Tétrault, Torys, and Gowling WLG, law professors from the University of Toronto, management consultants, engineers, and data scientists.

What if I’m not ready to embrace AI yet?

Some lawyers are apprehensive about adopting new technologies in their practice, and understandably so – it’s a pivotal decision. Those who choose to adopt AI are comforted by an important fact: AI won’t replace you, what it will do is validate your instincts by giving you the data-backed edge you need.

CBA Legal Futures Initiative reports on the future of legal services from 2013 and 2014 predicted AI would make big waves in the legal field. In the years since then, AI has only grown in law firms — waiting or delaying adoption is only prolonging inevitable adoption after others have already done so, or obsoletion.

How does Blue J Legal protect my privacy and my clients’ privacy?

To ensure that your data is kept secure, Blue J Legal has reasonable administrative, technical and physical safeguards in place in an effort to protect against unauthorized access, use, modification, and disclosure of personal information in our custody and control.

Blue J Legal won’t disclose your information based on a request from an individual to access or update personal information we have collected on behalf of a particular customer. In that situation we will direct that individual to the relevant customer.